Does anyone really think "Tea Party" organizations are nonpolitical?

The question is whether they were singled out because they were on the right. Some are claiming that they were not singled out. The IRS just assigned a task force to look only at the conservative groups because they thought it would be more efficient that way. The IRS is also investigating similar liberal groups, but did not create a special team to look at them.

But, this begs the question of whether the abuse of the tax code was happening more often by right wing groups than left wing. If that is the case, then the IRS should be investigating more right wing groups.

They look pretty innocent to me

http://www.andreadaly.com/blog/wp-content/uploads/2009/09/chimp-tea.jpg

I'm not a lawyer/can't say whether specific laws were broken... but I don't see what the big deal is (maybe I will after the investigation). It seems like common sense to single out any group that is applying for tax exempt status that explicitly uses a word/phrase/identifier that is strongly connected with a political movement/organization/party. If a group has Socialist, Conservative, Progressive, Tea Party etc in their name they should certainly be given more scrutiny in the application process.

Precious Roy wrote:

But, this begs the question of whether the abuse of the tax code was happening more often by right wing groups than left wing. If that is the case, then the IRS should be investigating more right wing groups.

During the time period it was something like 80% of the *new* groups were Tea Party or some form of reduced government group.

Personally I don't feel ANY group filing for non-profit exempt status should get away without a full rectal exam, and ANY group that won't say exactly where their money is coming from shouldn't get it either.

MoveOn, NRA, Emily's List, American Crossroads, etc, are all spending a good chunk of their money on political purposes that include naming specific names in specific races. That's basically campaign finance. Sorry dudes, you do that and every single dime you make needs to be accounted for and every single orifice you have gets a light shined in it.

Exactly, were they "singled out" because they were right wing organizations or because they were likely to be political organziations trying to get an unfair tax exemption.I think the answer is obvious.

Precious Roy wrote:

The question is whether they were singled out because they were on the right. Some are claiming that they were not singled out. The IRS just assigned a task force to look only at the conservative groups because they thought it would be more efficient that way. The IRS is also investigating similar liberal groups, but did not create a special team to look at them.

But, this begs the question of whether the abuse of the tax code was happening more often by right wing groups than left wing. If that is the case, then the IRS should be investigating more right wing groups.

Conundrum wrote:

Exactly, were they "singled out" because they were right wing organizations or because they were likely to be political organziations trying to get an unfair tax exemption.

I think the answer is obvious.

Precious Roy wrote:

The question is whether they were singled out because they were on the right. Some are claiming that they were not singled out. The IRS just assigned a task force to look only at the conservative groups because they thought it would be more efficient that way. The IRS is also investigating similar liberal groups, but did not create a special team to look at them.

But, this begs the question of whether the abuse of the tax code was happening more often by right wing groups than left wing. If that is the case, then the IRS should be investigating more right wing groups.

They weren't just singling them out. The IRS was illegally demanding a list of donors and illegally leaking confidentially information. Again, why does George Soros' Moveon.org that raised millions for Obama and Obama's community organizing "Organizing for America", now called "Organizing for Action" free from scrutiny. Talk about political - Organizing for Action runs the official Barack Obama twitter feed. Not to mention I am just bombarded by their political e-mails.

This thread is a muddled mess. Political Parties may be tax exempt under section 527 of the IRS code--which provides that their primary purpose must be performing an exempt function:

Exempt Function - Political Organization

The exempt function of a political organization is influencing or attempting to influence the selection, nomination, election or appointment of an individual to a federal, state, or local public office or office in a political organization. The election of Presidential or Vice-Presidential electors is also part of the exempt function of a political organization. Activities that directly or indirectly relate to or support an exempt function are exempt function activities.

The tea party organizations in question were claiming exemption under section 503 (c)(4), which means such organizations may engage in lobbying and other political activities but are restricted from other kinds of political activites such as the Exempt functions above.

Contributions to 527 and 503 (c)(4) organizations are not tax deductible, unlike 501 (c)(3) organizations. So while there are some differences in the two, especially in reporting requirements, it is not a question of whether these groups were going to pay taxes or not. They were never going to pay taxes, it is just a matter of determining correct classification.

Don't forget churches and other "religious" organizations who blatantly voice partisan political rhetoric and direct voting choices to their flocks, contrary to those pesky federal laws.

It is no wonder that the Tea Party, whose stated goals include tax protests and opposing government, would have a beef with the IRS. Of course they would and should be scrutinized, given their stated purposes.

Thread restored.

It looked interesting and when I clicked on it it was gone.

Keep it civil.

Is it civil to come on here and start a thread under false presumptions? What I said that got deleted was "do your homework, then open your big mouth". Is this not civil in your opinion Wejo? Or really worthy of deletion? Sounds more like politically biased censorship to me. But it's your site and you can take sides if that's the kind of man you are.

I guess I have to do the homework for people to keep the kings happy. First this then I'll throw in a few facts about non-profits:

Brietbart:

The progressive-leaning investigative journalism group ProPublica says the Internal Revenue Service (IRS) office that targeted and harassed conservative tax-exempt groups during the 2012 election cycle gave the progressive group nine confidential applications of conservative groups whose tax-exempt status was pending.

The commendable admission lends further evidence to the lengths the IRS went during an election cycle to silence tea party and limited government voices.

ProPublica says the documents the IRS gave them were “not supposed to be made public”:

The same IRS office that deliberately targeted conservative groups applying for tax-exempt status in the run-up to the 2012 election released nine pending confidential applications of conservative groups to ProPublica late last year... In response to a request for the applications for 67 different nonprofits last November, the Cincinnati office of the IRS sent ProPublica applications or documentation for 31 groups. Nine of those applications had not yet been approved—meaning they were not supposed to be made public. (We made six of those public, after redacting their financial information, deeming that they were newsworthy.)

The group says that "no unapproved applications from liberal groups were sent to ProPublica.”

According to Media Research Center Vice President for Business and Culture Dan Gainor, ProPublica’s financial backers include top progressive donors:

ProPublica, which recently won its second Pulitzer Prize, initially was given millions of dollars from the Sandler Foundation to “strengthen the progressive infrastructure”–“progressive” being the code word for very liberal. In 2010, it also received a two-year contribution of $125,000 each year from the Open Society Foundations. In case you wonder where that money comes from, the OSF website is

www.soros.org

. It is a network of more than 30 international foundations, mostly funded by Soros, who has contributed more than $8 billion to those efforts.

On Friday, the House Ways and Means Committee is scheduled to hold a formal hearing on the IRS conservative targeting scandal. IRS Commissioner Steve Miller and Treasury Inspector General for Tax Administration J. Russell George are slated to testify.

Wikipedia:

General compliance issues [edit]Under Section 511, a 501(c) organization is subject to tax on its "unrelated business income", whether or not the organization actually makes a profit, but not including selling donated merchandise or other business or trade carried on by volunteers, or certain bingo games.[4] Disposal of donated goods valued over $2,500, or acceptance of goods worth over $5,000 may also trigger special filing and record-keeping requirements.

Tax exemption does not excuse an organization from maintaining proper records and filing any required annual or special-purpose tax returns, e.g., 26 U.S.C. § 6033 and 26 U.S.C. § 6050L. Previously, annual returns were not generally required from an exempt organization accruing less than $25,000 in gross income yearly.[5] However, from 2008 onwards, many such organizations must file a yearly "e-Postcard" known as Form 990-N, or risk losing their exemption, with the maximum accrual being $50,000 to file a 990-N now.[6] Form 990-N must be submitted electronically using an authorized IRS efile provider. Other types of Form 990 may be submitted via mail and some are available electronically through an IRS efile provider. IRS

Failure to file required returns such as Form 990 (Return of Organization Exempt From Income Tax) may result in monetary fines of up to $250,000 per year. Exempt or political organizations (excluding churches or similar religious entities) must make their returns, reports, notices, and exempt applications available for public inspection. The organization's Form 990 (or similar such public record as the Form 990-EZ or Form 990-PF) is generally available for public inspection and photocopying at the offices of the exempt organization, through a written request and payment for photocopies by mail from the exempt organization, or through a direct Form 4506-A Request for Public Inspection or Copy or Political Organization IRS Form request to the IRS of the exempt organization filing of Form 990 for the past three tax years. The Form 4506-A also allows the public inspection and/or photocopying access to Form 1023 Application for Recognition of Exemption or Form 1024, Form 8871 Political Organization Notice of Section 527 Status, and Form 8872 Political Organization Report of Contribution and Expenditures. Internet access to an organization's 990 and some other forms are available through information services such as GuideStar.

Failure to file such timely returns and to make other specific information available to the public also is prohibited.[7]

501(c)(3) [edit]501(c)(3) exemptions apply to corporations, and any community chest, fund, cooperating association or foundation, organized and operated exclusively for religious, charitable, scientific, testing for public safety, literary, or educational purposes, to foster national or international amateur sports competition, to promote the arts, or for the prevention of cruelty to children or animals.[8][9] There are also supporting organizations which are often referred to in shorthand form as "Friends of" organizations.[10][11][12][13][14]

Another provision, 26 U.S.C. § 170, provides a deduction, for federal income tax purposes, for some donors who make charitable contributions to most types of 501(c)(3) organizations, among others. Regulations specify which such deductions must be verifiable to be allowed (e.g., receipts for donations over $250). Due to the tax deductions associated with donations, loss of 501(c)(3) status can be highly challenging to a charity's continued operation, as many foundations and corporate matching programs do not grant funds to a charity without such status, and individual donors often do not donate to such a charity due to the unavailability of the deduction.

Testing for public safety is described under section 509(a)(4) of the code, which makes the organization a public charity and not a private foundation,[15] but contributions to 509(a)(4) organizations are not deductible by the donor for federal income, estate, or gift tax purposes.

The two exempt classifications of 501(c)(3) organizations are as follows:[16]

A public charity, identified by the Internal Revenue Service (IRS) as "not a private foundation," normally receives a substantial part of its income, directly or indirectly, from the general public or from the government. The public support must be fairly broad, not limited to a few individuals or families. Public charities are defined in the Internal Revenue Code under sections 509(a)(1) through 509(a)(4).

A private foundation, sometimes called a non-operating foundation, receives most of its income from investments and endowments. This income is used to make grants to other organizations, rather than being disbursed directly for charitable activities. Private foundations are defined in the Internal Revenue Code under section 509(a) as 501(c)(3) organizations, which do not qualify as public charities.

Before donating to a 501(c)(3) organization, a donor may wish to review IRS Publication 78, which lists organizations currently exempt under 501(c)(3).[17] Donors may also verify 501(c)(3) organizations on the web-based, searchable IRS list of charitable organizations[18] as well as on lists maintained by the states, typically on states' Departments of Justice websites. Churches, however, have specific requirements to obtain and maintain tax exempt status; these are outlined in IRS Publication 1828: Tax guide for churches and religious organizations.[19] This guide clearly outlines activities allowed and not allowed by churches under the 501(c)(3) designation. A private, nonprofit organization, GuideStar, also provides reputable and detailed results for web-based searching to verify information on 501(c)(3) organizations.[20]

Consumers may file IRS Form 13909 with documentation to complain about inappropriate or fradulent (i.e., fundraising, political campaigning, lobbying) activities by any 501(c)(3) tax-exempt organization.[21]

Obtaining status [edit]The basic requirement of getting tax exempt status is that the organization is specifically limited in powers to purposes that the IRS classifies as tax exempt purposes. Unlike for-profit corporations that benefit from broad and general purposes, non profit organizations need to be limited in powers to function with tax exempt status, but a non profit corporation is by default not limited in powers until it specifically limits itself in the articles of incorporation and/or nonprofit corporate bylaws. This limiting of the powers is crucial to obtaining tax exempt status with the IRS and then on the state level. You acquire 501(c)(3) tax exemption by filing IRS Form 1023. The form must be accompanied by a $850 filing fee if the yearly gross receipts for the organization are expected to average $10,000 or more.[22][23] If yearly gross receipts are expected to average less than $10,000, the filing fee is reduced to $400.[22][23] There are some classes of organizations that automatically are treated as tax exempt under 501(c)(3), without the need to file Form 1023:

Churches, their integrated auxiliaries, and conventions or associations of churches[24]

Organizations that are not private foundations and that have gross receipts that normally are not more than $5,000[25]

The IRS also expects to release a software tool called Cyber Assistant, which will assist with preparation of the application for tax exemption, but as of late 2011 the release date is unclear.[26]

Political activity [edit]Section 501(c)(3) organizations are absolutely prohibited from supporting political candidates, and are subject to limits on lobbying. They risk loss of tax exempt status if these rules are violated.[27][28]

Elections [edit]Organizations described in section 501(c)(3) are prohibited from conducting political campaign activities to intervene in elections to public office.[29] The Internal Revenue Service website elaborates upon this prohibition as follows:

Under the Internal Revenue Code, all section 501(c)(3) organizations are absolutely prohibited from directly or indirectly participating in, or intervening in, any political campaign on behalf of (or in opposition to) any candidate for elective public office. Contributions to political campaign funds or public statements of position (verbal or written) made on behalf of the organization in favor of or in opposition to any candidate for public office clearly violate the prohibition against political campaign activity. Violating this prohibition may result in denial or revocation of tax-exempt status and the imposition of certain excise taxes.

Certain activities or expenditures may not be prohibited depending on the facts and circumstances. For example, certain voter education activities (including presenting public forums and publishing voter education guides) conducted in a non-partisan manner do not constitute prohibited political campaign activity. In addition, other activities intended to encourage people to participate in the electoral process, such as voter registration and get-out-the-vote drives, would not be prohibited political campaign activity if conducted in a non-partisan manner.

On the other hand, voter education or registration activities with evidence of bias that (a) would favor one candidate over another; (b) oppose a candidate in some manner; or (c) have the effect of favoring a candidate or group of candidates, will constitute prohibited participation or intervention.

The Internal Revenue Service provides resources to exempt organizations and the public to help them understand the prohibition. As part of its examination program, the IRS also monitors whether organizations are complying with the prohibition.

Lobbying [edit]In contrast to the absolute prohibition on political campaign interventions by all section 501(c)(3) organizations, public charities (but not private foundations) may conduct a limited amount of lobbying to influence legislation. Although the law states that "No substantial part..." of a public charity's activities can go to lobbying, charities with large budgets may lawfully expend a million dollars (under the "expenditure" test), or more (under the "substantial part" test) per year on lobbying.[30] To clarify the standard of the "substantial part" test, Congress enacted §501 (h) (called the Conable election after its author, Representative Barber Conable). The section establishes limits based on operating budget that a charity can use to determine if it meets the substantial test. This changes the prohibition against direct intervention in partisan contests only for lobbying. The organization is now presumed in compliance with the substantiality test if they work within the limits. The Conable Election requires a charity to file a declaration with the IRS and file a functional distribution of funds spreadsheet with their Form 990. IRS form 5768[31] is required to make the Conable election.

501(c)(4) [edit]See also: Citizens United v. Federal Election Commission

501(c)(4) organizations are generally civic leagues and other corporations operated exclusively for the promotion of social welfare, or local associations of employees with membership limited to a designated company or people in a particular municipality or neighborhood, and with net earnings devoted exclusively to charitable, educational, or recreational purposes.[32] 501(c)(4) organizations may lobby for legislation, and unlike 501(c)(3) organizations they may also participate in political campaigns and elections, as long as its primary activity is the promotion of social welfare.[33] The tax exemption for 501(c)(4) organizations applies to most of their operations, but contributions may be subject to gift tax, and income spent on political activities - generally the advocacy of a particular candidate in an election - is taxable.[34]

Contributions to 501(c)(4) organizations are usually not deductible as charitable contributions for U.S. federal income tax, with a few exceptions.[35] 501(c)(4) organizations are not required to disclose their donors publicly.[36]

The lack of disclosure has led to extensive use of the 501(c)(4) provisions for organizations that are actively involved in lobbying, and has become controversial.[37][38] Criticized as "dark money," spending from these organizations on political TV ads has exceeded spending from Super PACs.[39][40]

The law allows Section 501(c)(4) organizations to self-declare and hold themselves out as tax-exempt; they do not have to obtain any approval from the Internal Revenue Service, though they may.[41]

501(c)(5) [edit]501(c)(5) organizations include labor, agricultural, and horticultural organizations. Labor unions, county fairs, and flower societies are examples of these types of groups. They share a requirement that benefits may not inure to a specific member but the rules for inurement vary among the three different types of organizations under this segment.[42]

501(c)(6) [edit]501(c)(6) organizations include Business Leagues, Home Builders Association, Chambers of Commerce, Real Estate Boards, etc. such as the U.S. Chamber of Commerce and the Edison Electric Institute.

Mr. Obvious wrote:

They were never going to pay taxes, it is just a matter of determining correct classification.

Not entirely, they have to pay taxes on money that they spend advocating a particular candidate because policy advocacy is tax-exempt while political advocacy is not.

For tea-party/small government groups, this line in much finer than it is for other advocacy groups because advocating for small government involves exposing government waste that is created by politicians.

Thereinliestherub wrote:

Is it civil to come on here and start a thread under false presumptions? What I said that got deleted was "do your homework, then open your big mouth". Is this not civil in your opinion Wejo? Or really worthy of deletion? Sounds more like politically biased censorship to me. But it's your site and you can take sides if that's the kind of man you are.

A one line post saying, "do your homework, then open your big mouth" doesn't add anything to the conversation.

It is posts like that that are not reported but bring down the level of conversation so yes it should be deleted. Usually, they are left up because they aren't reported. Post like yours can lead to you and the OP bickering back and forth and then the thread loses its purpose.

And I'm glad to being accused of biased against the right because usually it's the other way around.

Your post actually didn't have any substance to it so I couldn't really take offense to what was said in a political context but how it was said. Thus the deletion.

Your post seemed anything but obvious but more convoluted. The IRS is very clear. Tax exempt status organizations " are absolutely prohibited from...indirectly participating in any political campaign.Read below for the straight forward truth directly from tax law.The Restriction of Political Campaign Intervention by Section 501(c)(3) Tax-Exempt OrganizationsUnder the Internal Revenue Code, all section 501(c)(3) organizations are absolutely prohibited from directly or indirectly participating in, or intervening in, any political campaign on behalf of (or in opposition to) any candidate for elective public office. Contributions to political campaign funds or public statements of position (verbal or written) made on behalf of the organization in favor of or in opposition to any candidate for public office clearly violate the prohibition against political campaign activity. Violating this prohibition may result in denial or revocation of tax-exempt status and the imposition of certain excise taxes.

501 (c)(3) organizations are not 501 (c)(4) organizations. The entities in question were all applying as 501 (c)(4) organizations, as far as I have read.

This is a blatant attempt to sidestep a critically important matter, which is that the President is trying to suppress dissent by sicking the IRS on his adversaries. Whether "Tea Party" groups deserve tax exempt status is utterly irrelevant in the context of the current controversy, and the people trying to deflect the criticism Obams tightly deserves by making up red herrings like this are political lowlifes.

NotSoObvious wrote:

Not entirely, they have to pay taxes on money that they spend advocating a particular candidate because policy advocacy is tax-exempt while political advocacy is not.

For tea-party/small government groups, this line in much finer than it is for other advocacy groups because advocating for small government involves exposing government waste that is created by politicians.

Yes, that must be why Democratic and Republican parties, as well as political PACS and candidate campaign committees all pay taxes. Oh wait, they don't since they are exempt under portions of section 527 or the tax code.

the OP is a partisan crackpot wrote:

This is a blatant attempt to sidestep a critically important matter, which is that the President is trying to suppress dissent by sicking the IRS on his adversaries. Whether "Tea Party" groups deserve tax exempt status is utterly irrelevant in the context of the current controversy, and the people trying to deflect the criticism Obams tightly deserves by making up red herrings like this are political lowlifes.

But it could also be that the Tea Party groups have been caught red handed in a major tax avoidance scam and are blatantly abusing the 501(c)4 designation. Just because the IRS targeted a group based on ideology doesn't mean that the targeted group gets a free pass to be tax cheats.